• TABLE OF CONTENTS
HIDE
 Copyright
 Title Page
 Table of Contents
 Method of selecting dairies to...
 Number of records obtained and...
 Method of calculating costs
 Acres operated and use of land
 Number of rate of turnover of cows...
 Average inventory value, purchase...
 Amount of distribution of...
 Amount of milk sold and production...
 Man equivalent of labor and labor...
 Efficiency in the use of capit...
 Receipts
 Expenses
 Returns
 Summary






Group Title: Mimeo report - Department of Agricultural Economics, University of Florida - EC 67-9
Title: Summary of costs and returns for wholesale dairy farms in Southeast Florida, 1965
CITATION PAGE IMAGE ZOOMABLE PAGE TEXT
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00071984/00001
 Material Information
Title: Summary of costs and returns for wholesale dairy farms in Southeast Florida, 1965
Physical Description: 28 p., : tables, ; 28 cm.
Language: English
Creator: Greene, R. E. L ( Robert Edward Lee ), 1910-
Publisher: University of Florida, Agricultural Experiment Stations
Place of Publication: Gainesville Fla
Publication Date: 1967
 Subjects
Genre: non-fiction   ( marcgt )
 Notes
Statement of Responsibility: by R.E.L. Greene.
General Note: Ag. Mim. EC 67-9.
General Note: March 1967.
Funding: Florida Historical Agriculture and Rural Life
 Record Information
Bibliographic ID: UF00071984
Volume ID: VID00001
Source Institution: Marston Science Library, George A. Smathers Libraries, University of Florida
Holding Location: Florida Agricultural Experiment Station, Florida Cooperative Extension Service, Florida Department of Agriculture and Consumer Services, and the Engineering and Industrial Experiment Station; Institute for Food and Agricultural Services (IFAS), University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: oclc - 29970027

Table of Contents
    Copyright
        Copyright
    Title Page
        Title Page
    Table of Contents
        Table of Contents
    Method of selecting dairies to be studied
        Page 1
        Page 2
    Number of records obtained and method of summarizing and presenting data
        Page 3
    Method of calculating costs
        Page 4
    Acres operated and use of land
        Page 5
    Number of rate of turnover of cows in the milking herd and heifers raised
        Page 5
        Page 6
        Page 7
    Average inventory value, purchase price and sales price per head
        Page 8
    Amount of distribution of capital
        Page 8
    Amount of milk sold and production per cow
        Page 9
        Page 10
        Page 11
    Man equivalent of labor and labor efficiency
        Page 12
    Efficiency in the use of capital
        Page 12
    Receipts
        Page 13
        Page 14
        Page 15
    Expenses
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
    Returns
        Page 24
        Page 25
    Summary
        Page 26
        Page 27
        Page 28
Full Text





HISTORIC NOTE


The publications in this collection do
not reflect current scientific knowledge
or recommendations. These texts
represent the historic publishing
record of the Institute for Food and
Agricultural Sciences and should be
used only to trace the historic work of
the Institute and its staff. Current IFAS
research may be found on the
Electronic Data Information Source
(EDIS)

site maintained by the Florida
Cooperative Extension Service.






Copyright 2005, Board of Trustees, University
of Florida









March 1967


Agricultural Mimeo
Report EC 67-9


SUMMARY OF COSTS AND RETURNS


FOR WHOLESALE DAIRY FARMS


IN SOUTHEAST FLORIDA, 1965


R. E. L. Greene
' Agricultural Economist


1.F.A$S Lji-i''. :vrc1;cb


Department of Agricultural Economics
Agricultural Experiment Stations
Institute of Food and Agricultural Sciences
University of Florida, Gainesville


7.
L*) ;,


~" "`










TABLE OF CONTENTS


Method of Selecting Dairies to be Studied . . .

Number of Records Obtained and Method of Summarizing and
Presenting Data . . . . . .

Method of Calculating Costs . . . .

Acres Operated and Use of Land . . . .

Number and Rate of Turnover of Cows in the Milking Herd and
Heifers Raised . . . . . .

Average Inventory Value, Purchase Price and Sales Price
Per Head . . . . . .

Amount and Distribution of Capital . . . .

Amount of Milk Sold and Production Per Cow . . .

Man Equivalent of Labor and Labor Efficiency . .

Efficiency in the Use of Capital . . .

Receipts . . . . . . .

Expenses . . . . . . .

Returns. . . . . . . .

Summary . . . . . . .


Page





3

4

5



5



8

8

9

. . 12

12
* 3






















. . 12

. . 12


. . 16

. . 24

. . 26











SUMMARY OF COSTS AND RETURNS FOR WHOLESALE DAIRY FARMS
IN SOUTHEAST FLORIDA, 1965


This report presents the results of a study of dairy farms in
Southeast Florida to obtain data on costs and returns in producing milk
during the 1965 calendar year.-1 This survey was made by members of the
Department of Agricultural Economics of the Florida Agricultural Experiment
Station in cooperation with the Agricultural Extension Service.2/


Method of Selecting Dairies to be Studied

To aid in selecting a sample for the study, two dairy farm
organizations in Southeast Florida furnished data for their members on
the amount of milk delivered during the month of October 1965. Data
were obtained for 83 management units/ on which 99 dairy units were
operated.

For the purpose of sampling the management units were divided into
two groups--those where there was only one dairy herd on a single farm, and
milked in one dairy barn (single unit farms), and management units where
there were two or more herds on one or more farms milked in different
dairy barns (multiple unit farms). The multiple unit group also included
operators with two or more farms that may have been operated together or
independently. There were 72 single unit farms (Table 1). The multiple
unit group included 10 management units that operated 27 dairy units.
The single unit farms were divided into three size groups based on pounds
of milk delivered per day during the month of October--Group I, less than
8,100 pounds, Group II, 8,100 to 16,199 pounds and Group III, 16,200 pounds
or more. The multiple unit farms were designated as Group IV farms. In
the analysis and presentation of data in this report, the four groups are
referred to as Group I, Group II, Group III and Group IV farms.


/ Some of the dairies studied used a fiscal year different from
the calendar year. In these cases, the most recent fiscal year was used.

2/
/ Aid in obtaining farm records was given by the following County
Agents, Associate County Agents and Assistant County Agents of the Florida
Extension Service: B. O. Bass, Clifford R. Boyles, James F. Cummings,
John D. Campbell, Bert J. Harris, Jr., Levi M. Johnson, Forrest McCullars,
R. K. Price and Hugh C. Whelchel, Jr. Assistance was also given by
Clifford Alston, Economist, Farm Management and Charles L. Anderson,
Interim Assistant, Farm Management.

3/A management unit included all of the land and dairy cattle
under the control of one or more operators operated as a single unit or
more than one unit.






Table l.--Variation in Number of Units and Pounds of Milk Delivered Per
Dairy Farms and Number of Multiple Management Units and Dairy
Southeast Florida, October 1965.


Day for Operators of Single Unit
Units, Wholesale Dairy Farms,


Average number of Percent of total for:
Number of: pounds delivered per day Number. of:.
Number of: Number. of: :
e Per : Per .: Pounds of
Item :Management: Dairy : management : dairy : Management: Dairy : milk delivered
Units : units : unit : unit units : units : per day

Single Unit Farms:
Pounds of milk delivered
per day:
Less than 8,100 23 23 4,733 4,733 28.1 23.2 7.7
8,100 to 16,199 33 33 11,462 11,462 40.2 33.3 26.7
16,200 or more 16 16 20,521 20,521 19.5 16.2 32.8
Total or average 72 72 13,230 13,230 87.8 72.7 67.2

Multiple unit farms 10- 27a 46,546 17,239 12.2 27.3 32.8
Grand total or average 82 99 17,293 14,324 100.0 100.0 100.0

a/Does not include one independent management unit with four dairy units.









Group I farms included 28 percent of the management units,
23 percent of the dairy units, but delivered only 7.7 percent of the daily
deliveries of milk during October 1965. Group II farms included 40 percent
of the management units, 33 percent of the dairy units and accounted for
26.7 percent of the daily deliveries of milk. Group III farms included
20 percent of the management units, 16 percent of the dairy units and
accounted for 32.8 percent of the deliveries of milk. Group IV farms
included only 12 percent of the management units but 27 percent of the
dairy units and accounted for 32.8 percent of the daily deliveries of
milk.

Dairy units in Southeast Florida are much larger than those in
other areas of the state. The average daily delivery per dairy unit for
October 1965 was 14,324 pounds or 1,666 gallons. During 1965, producers
in Southeast Florida delivered 530 million pounds f milk to plants in
the Federal Order Southeastern Florida milk area.' This was 39 percent
of all producer milk sold in Florida in 196521.


Number of Records Obtained and Method of
Summarizing and Presenting Data

Using data on deliveries of milk for October 1965, a sample of
farms to be surveyed was randomly selected to represent producers in
Groups I, II, and III farms. Records were obtained from operators of
four management units in Group IV covering eight dairy units. Table 2
shows the number of dairy units for which records were obtained in each
group and the proportion the dairy units surveyed were of all dairy units
in the group.

In summarizing and presenting the data, averages are shown for
each of the four groups of farms. For Group IV farms, averages are on the
basis of a dairy unit rather than a management unit. The dairy unit was
used to make the data for this group more comparable to those in Groups I,
II and III. No attempt was made to calculate an average per farm for all
in Southeast Florida because of the extreme variation in size of individual
dairy units. During October 1965, daily deliveries for the largest dairy
unit in the area were about 29 times greater than daily deliveries for
the smallest unit.


1/Compilation of Statistical Data Pertaining to Federal Order
No. 13, Southeastern Florida Marketing Area, March 1966, Office of Milk
Market Administrator, Fort Lauderdale, Florida.
Milk Production, Disposition and Income 1964-65 U.S.D.A.,
Statistical Reporting Service, Crop Reporting Board, April 1966.









Table 2.--Number of Management and Dairy Units and Number and Percent of
Dairy Units for which Data were Obtained, Wholesale Dairy Farms,
Southeast Florida.


Number of:
Item : Number of dairy : Percent of dairy
::Management: Dairy : units surveyed : units surveyed
_: units : units :

Single unit farms:
Pounds of milk
delivered per day:
Less than 8,100 23 23 7 30.4
8,100 to 16,199 33 33 16 48.5
16,200 or more 16 16 5 31.2
Total or
average 72 72 28 38.8

Multiple unit farms 10 27 8 29.6
Total or average 82 99 36 36.4


Method of Calculating Costs


Information for each dairy unit included in the study was obtained
in a personal interview with the farm operator or manager. Data on income
and expenses were taken from accountants' records or copies of income tax
returns. Data on amount and value of milk sold and percent butterfat were
copied from statements received by farmers for each pay period.

Most of the farmers surveyed were specializing in dairying with
receipts from the dairy enterprises being the only source of income. On
farms where there were other enterprises, necessary information was obtained
to separate all the data relating to the dairy enterprise from the rest of
the farm business. The data in this report relate only to the dairy part
of the farm business.

In calculating cost of producing milk, all expenses were charged
directly to the dairy enterprise. For example, no attempt was made to
separate the cost of replacements being raised from that of the milking herd.
However, the increase in value of young stock was considered as a credit to
the dairy enterprises and thus tended to reduce the amount of depreciation
for all livestock. Expenses for labor, seed, fertilizer and other costs
for producing harvested feeds or pasture were charged directly to the dairy
enterprise. Using this method, these items were charged to the milking
herd at their costs of production.









The production of milk on each farm was adjusted to a four percent
fat corrected (F.C.M.) basis to correct production on individual farms for
variations in percent butterfat of milk produced../ Costs and returns per
unit (hundredweight or gallon) were calculated on the basis of the number
of hundredweights or gallons of 4 percent F.C.M. milk sold. No credit
was allowed for milk used on the farm or in the home.

In obtaining information relating to the number of cows in the
dairy herd, data were obtained on the number of cows in the herd at the
beginning and ending of the year and also the number of cows added to or
removed from the herd each month. This made it possible to calculate the
number of cows in the herd the first of each month, and thus a "13-month"
inventory average. 2 All averages per cow shown in the report are based
on a 13-month inventory average.


Acres Operated and Use of Land

Acres of land per dairy unit and per cow in various uses are
shown in Table 3. Very few acres of forage crops were grown being reported
only on Group II and Group III farms. Acres of forage crops per farm,
including double cropping, were 24 and 71 for these two groups respectively.
Improved pasture land was 1.38 acres per cow for Group I farms, 1.06 for
Group II farms, .60 for Group III farms and 1.19 for Group IV farms. All
land averaged slightly over 1.5 acres per cow on Group I and Group II farms,
.81 on Group III farms and 1.41 on Group IV farms.


Number and Rate of Turnover of Cows in Milking Herd
and Heifers Raised

The number of cows on hand at the beginning and end of the year,
additions and subtractions during the year, years in the milking herd,
replacements raised and average number of cows for the year are shown in
Table 4. The average number of cows in the herd was 208 on Group I farms,


1/Four percent fat corrected milk was calculated as follows:
(.4 x pounds of milk) plus (15 x pounds of butterfat) equals pounds of
4 percent F.C.M. milk. If on Farm A and B, the average production per cow
was 9,500 pounds per year and the average butterfat 4.3 and 3.8 percent
respectively, the production per cow in terms of 4 percent fat corrected
milk would be 9,920 pounds on Farm A and 9,215 pounds on Farm B.
SA few farmers did not have the necessary information for
calculating a 13-month inventory. Average number of cows was based on a
simple average of the number on hand at the beginning and end of the year.









The production of milk on each farm was adjusted to a four percent
fat corrected (F.C.M.) basis to correct production on individual farms for
variations in percent butterfat of milk produced../ Costs and returns per
unit (hundredweight or gallon) were calculated on the basis of the number
of hundredweights or gallons of 4 percent F.C.M. milk sold. No credit
was allowed for milk used on the farm or in the home.

In obtaining information relating to the number of cows in the
dairy herd, data were obtained on the number of cows in the herd at the
beginning and ending of the year and also the number of cows added to or
removed from the herd each month. This made it possible to calculate the
number of cows in the herd the first of each month, and thus a "13-month"
inventory average. 2 All averages per cow shown in the report are based
on a 13-month inventory average.


Acres Operated and Use of Land

Acres of land per dairy unit and per cow in various uses are
shown in Table 3. Very few acres of forage crops were grown being reported
only on Group II and Group III farms. Acres of forage crops per farm,
including double cropping, were 24 and 71 for these two groups respectively.
Improved pasture land was 1.38 acres per cow for Group I farms, 1.06 for
Group II farms, .60 for Group III farms and 1.19 for Group IV farms. All
land averaged slightly over 1.5 acres per cow on Group I and Group II farms,
.81 on Group III farms and 1.41 on Group IV farms.


Number and Rate of Turnover of Cows in Milking Herd
and Heifers Raised

The number of cows on hand at the beginning and end of the year,
additions and subtractions during the year, years in the milking herd,
replacements raised and average number of cows for the year are shown in
Table 4. The average number of cows in the herd was 208 on Group I farms,


1/Four percent fat corrected milk was calculated as follows:
(.4 x pounds of milk) plus (15 x pounds of butterfat) equals pounds of
4 percent F.C.M. milk. If on Farm A and B, the average production per cow
was 9,500 pounds per year and the average butterfat 4.3 and 3.8 percent
respectively, the production per cow in terms of 4 percent fat corrected
milk would be 9,920 pounds on Farm A and 9,215 pounds on Farm B.
SA few farmers did not have the necessary information for
calculating a 13-month inventory. Average number of cows was based on a
simple average of the number on hand at the beginning and end of the year.









Table 3.--Acres of Land in Various Uses Per Dairy Unit and Per Cow,
36 Southeast Florida Dairy Units, 1965.


Item
Group I Group


Forage crops
Less acres double-
cropped
Total forage crop-
land
Improved pasture
Less acres double-
cropped
Total improved
pasturelland
Unimproved pasture
Other land
Total acres
operated



Forage crops
Less acres double-
cropped
Total forage crop-
land
Improved pasture
Less acres double-
cropped
Total improved
pasture land
Unimproved pasture
Other land
Total acres
operated


-- -




300

13

287
17
15

319









1.44

.06

1.38
.08
.07

1.53


24

20

4
619

87

532
22
209

767



.05

.04

.01
1.23

.17

1.06
.04
.42

1.53


Farm classification

II Group III Group

Acres per dairy unit

71

40

31
547 1,100

74 149

473 951
90 73
49 99

643 1,123

Acres per cow

.09

.05

.04
.69 1.38

.09 .19

.60 1.19
.11 .09
.06 .13

.81 1.41


IV :Your farm





-7-


Table 4.--Average Number of Cows in the Herd at the Beginning and End of
the Year, Number of Additions and Subtractions, Years in Milking
Herd, Percent Replacements Raised and Average Number of Cows for
the Year, 36 Southeast Florida Dairy Units, 1965.

Farm classification
Item
Group I : Group II Group III. Group IV Your farm

Number of cows at the
beginning of the year 213 513 814 788
Additions:
Purchased 36 54 191 125
Replacements raised 28 74 38 111
Total additions 64 128 229 236
Total supply 277 641 1,043 1,024
Subtractions:
Sold 59 131 201 201
Died 6 12 18 14
Total subtractions 65 143 219 215
Number of cows at the
end of the year 212 498 824 809
Total disposition 277 641 1,043 1,024
Years in the milking
herd 3.20 3.52 2.76 2.70
Average number of
heifers:
Per farm 79 213 72 346
Per 10 cows 3.80 4.24 .91 4.35
Percent of replacements
raised 43.8 57.8 16.6 47.0
Average number of cows
for the yearS/ 208 503 793 796

13-month inventory.


503 on Group II farms, 793 on Group III farms and 796 on Group IV farms.
Years a cow remained in the milking herd varied from 3.52 on Group II
farms to 2.70 on Group IV farms.

Heifers per 10 cows averaged 3.80 on Group I farms, 4.24 on
Group II farms, 4.35 on Group IV farms but only .91 on Group III farms.





-8-


The percent of replacements raised varied from 17 percent on Group III
farms to 58 percent on Group II farms.



Average Inventory Value, Purchase Price and
Sales Price Per Head

The average value placed on mature cows at the beginning and
end of the year varied from $276 on Group I farms to $296 on Group III
farms (Table 5). The cost of cows purchased varied from $237 per head
on Group II farms to $277 on Group IV farms. Heifers raised were valued
at about the same price as the cost of cows purchased. The price received
for cows sold was $127 on Group I farms, $150 on Group II farms, $174 on
Group III farms and $142 on Group IV farms.


Table 5.--Average Inventory Value, Purchase Price, Value of Replacement
Raised and Sales Price Per Head, 36 Southeast Florida Dairy
Units, 1965.


Farm classification
Item *
Group I :Group II : Group IIl Group IV Your farm

Average inventory
value/ $276 $290 $296 $282
Cost of cows
purchased 258 237 267 277
Value of replace-
ments raised 264 238 244 271
Sales price of cows
sold 127 150 174 142

a/Average value of cows on hand at the beginning and end of the
year.


Amount and Distribution of Capital

Estimates were furnished by the operators as to the value of
various capital assets owned or rented used in their dairy operations.
Land was valued at the level the farm operator estimated it to be worth for
dairy farming. Other assets were valued at their market value or at cost
less depreciation. Specifically, inventory values were determined as
follows:





-8-


The percent of replacements raised varied from 17 percent on Group III
farms to 58 percent on Group II farms.



Average Inventory Value, Purchase Price and
Sales Price Per Head

The average value placed on mature cows at the beginning and
end of the year varied from $276 on Group I farms to $296 on Group III
farms (Table 5). The cost of cows purchased varied from $237 per head
on Group II farms to $277 on Group IV farms. Heifers raised were valued
at about the same price as the cost of cows purchased. The price received
for cows sold was $127 on Group I farms, $150 on Group II farms, $174 on
Group III farms and $142 on Group IV farms.


Table 5.--Average Inventory Value, Purchase Price, Value of Replacement
Raised and Sales Price Per Head, 36 Southeast Florida Dairy
Units, 1965.


Farm classification
Item *
Group I :Group II : Group IIl Group IV Your farm

Average inventory
value/ $276 $290 $296 $282
Cost of cows
purchased 258 237 267 277
Value of replace-
ments raised 264 238 244 271
Sales price of cows
sold 127 150 174 142

a/Average value of cows on hand at the beginning and end of the
year.


Amount and Distribution of Capital

Estimates were furnished by the operators as to the value of
various capital assets owned or rented used in their dairy operations.
Land was valued at the level the farm operator estimated it to be worth for
dairy farming. Other assets were valued at their market value or at cost
less depreciation. Specifically, inventory values were determined as
follows:









1. Land. The farmer's estimate of its value for dairy farming.
2. Machinery, equipment, buildings,fences, etc. The net book
value as recorded in the farm inventory for reporting income
tax.
3. Livestock. The farmer's estimate of the market value of cows,
bulls and heifers on his dairy farm.
4. Feed, supplies and other. The value of these items based on
market value.

Capital owned.--The average amount of capital furnished by the
operator on a per farm basis varied from $189,108 for Group I farms to
$572,884 for Group IV farms (Table 6). The value of operator's capital
per cow varied from $577 on Group II farms to $909 on Group I farms. A
number operators of Groups II, III and IV farms rented all or most of their
land and building.1- This mainly accounts for the lower value per cow on
these farms compared to farms in Group I. The average values per cow for
all livestock and for machinery and equipment did not show a wide variation
between the four groups of farms.

Capital managed.--The value of owned and rented capital (capital
managed) is shown in Table 7. As indicated above, a number of operators
of Group II, III and IV farms rented all or most of their land and buildings.
For the average operator, the value of real estate capital that was rented
accounted for only 2.5 percent of the total value of all real estate on
Group I farms, but 62.1 percent on Group II farms, 46.9 percent on Group III
farms and 26.9 percent on Group IV farms. The value per farm of all capital
managed was $191,779 on Group I farms, $426,857 on Group II farms, $611,287
on Group III farms and $664,296 on Group IV farms.

On a per cow basis, the value of all capital varied from $771 on
Group III farms to $922 on Group I farms. Value of real estate accounted
for approximately 50 percent of all capital and all livestock 40 percent.


Amount of Milk Sold and Production Per Cow

The amount of 4 percent F.C.M. milk sold per farm per year varied
from 1,815,365 pounds on Group I farms to 7,113,060 pounds on Group III
farms (Table 8). Average sales per day was 4,974 pounds on Group I farms,


y The high figure for capital rented was due partly to the fact
that a number of farms were operated as corporations. In many cases the
dairy corporation rented from the corporation owning the land although both
corporations were under the same ownership and management.






-10-


Table 6.--Amount and Distribution of Operator's Capital (Capital Owned),
36 Southeast Florida Dairy Units, 1965.

Farm classification
Item
Group I: Group II Group III: Group IV Your farm


Average amount per dairy unit


Land and improvements
Buildings, fences, etc.
Total real estate
Livestock
Machinery and equipment
Feed
Supplies and other
Total


$ 65,955
36,871
102,826
69,853
15,533
896

$189,108


$ 52,726
29,877
82,603
173,970
29,437
4,075
293
$290,378


$ 67,575
90,930
158,505
254,035
53,085
5,681
100
$471,406


Average amount per


Land and improvements
Buildings,fences, etc.
Total real estate
Livestock
Machinery and equipment
Feed
Supplies and other
Total


$317
177
494
336
75
4

$909
$909


$105
59
164
346
58
8
1
$577


$ 85
115
200
320
67
7
b/
$594


$167,113
81,208
248,321
267.114
52,165
5,284
-
$572,884
aco
cow-


$210
102
312
336
65
7

$720


Percent of total


Land and improvements
Buildings, fences, etc.
Total real estate
Livestock
Machinery and equipment
Feed
Supplies and other
Total


34.9
19.5
54.4
36.9
8.2
.5

100.0


18.2
10.3
28.5
59.9
10.1
1.4
.1
100.0


14.3
19.3
33.6
53.9
11.3
1.2
c/
100.0


29.2
14.2
43.4
46.6
9.1
.9

100.0


-Based on a "13-month" inventory.
b/
SLeas than 50 cents.
/Less than .05 percent.
-Less than .05 percent.


--






-11-


Table 7.--Amount and Distribution of Operator's Capital (Capital Managed)
36 Southeast Florida Dairy Units, 1965.


: Farm classification
Item
SGroup I Group II Group III Group IV : Your farm
: !


Average amount per dairy unit


Land and improvements
Buildings, fences, etc.
Total real estate
Livestock
Machinery and equipment
Feed
Supplies and other
Total


$'68;055
37 442
105,497
69,853
15,533
896

$191,779


$159,888
58,179
218,067
174,985
29,437
4,075
293
$426,857


$174,669
123.717
298,386
254,035
53,085
5,681
100
$611,287


$249,150
90,583
339,733
267,114
52,165
5,284

$664,296


a/
Average amount per cow-


Land and improvements
Buildings fences, etc.
Total real estate
Livestock
Machinery and equipment
Feed
Supplies and other
Total


$327
180
507
336
75
4

$922


$318
116
434
348
58
8
1
$849


$220
156
376
321
67
7

$71
$771


$313
114
427
336
65
7

$835


Percent of total


Land:and improvements
Buildings, fences, etc.
Total real estate
Livestock
Machinery and equipment
Feed
Supplies and other
Total


35.5
19.5
55.0
36.4
8.1
.5

100.0


37.5
13.6
51.1
41.0
6.9
.9
.1
100.0


28.6
20.2
48.8
41.6
8.7
.9
c/
100.0


37.5
13.6
51.1
40.2
7.9
.8

100.0


/ Based on a "13-month" inventory.
- Less than 50 cents.
/Less than .05 percent.
Less than .05 percent.







-12-


Table 8.--Annual Milk Sales Per Dairy Unit and Per Cow, 36 Southeast
Florida Dai;y Units, 1965.

Farm classification
Item
Group I : Group II Group III Group IV :Your farm

Pounds of 4 percent
F.C.M. milk sold:
Per dairy unit:
Per year 1,815,365 4,220,674 7,113,060 6,552,151
Per day 4,974 11,563 19,488 17,951

Per cow:
Per year 8,728 8,391 8,970 8,231
Per day 23.91 22.99 24.58 22.55


11,563 pounds on Group II farms, 19,488 pounds on Group III farms and 17,951
pounds on Group IV farms. In terms of gallons, average daily sales were
578, 1,344, 2,266 and 2,087 for the four groups of farms, respectively.
Pounds of milk sold per cow per year were 8,728 on Group I farms, 8,391
on Group II farms, 8,970 on Group III farms and 8,231 on Group IV farms.


Man Equivalent of Labor and Labor Efficiency

Man equivalents were calculated by dividing total months of labor
use, including the labor of the operator and his family, by 12. This
gave the average number of men for the year. Measures of labor efficiency
indicate how much the labor force accomplishes. Cows per man, heifers
per man, pounds of milk sold per man and acres of improved pasture per
man were calculated, respectively, by dividing number of cows, number of
heifers, pounds of milk sold and acres of improved pasture by man equivalent.

Man equivalents of labor varied from 4.77 on Group I farms to
16.32 on Group IV farms (Table 9). Number of cows per man ranged from
43.6 on Group I farms to 57.3 on Group III farms. Pounds of 4 percent
F.C.M. milk sold per man was 380,580 on Group I farms, 378,196 on Group II
farms, 514,321 on Group III farms and 401,480 on Group IV farms.


Efficiency in the Use of Capital

The percent capital turnover for capital owned and capital managed
was calculated by dividing the value of milk sold by the value of capital







-12-


Table 8.--Annual Milk Sales Per Dairy Unit and Per Cow, 36 Southeast
Florida Dai;y Units, 1965.

Farm classification
Item
Group I : Group II Group III Group IV :Your farm

Pounds of 4 percent
F.C.M. milk sold:
Per dairy unit:
Per year 1,815,365 4,220,674 7,113,060 6,552,151
Per day 4,974 11,563 19,488 17,951

Per cow:
Per year 8,728 8,391 8,970 8,231
Per day 23.91 22.99 24.58 22.55


11,563 pounds on Group II farms, 19,488 pounds on Group III farms and 17,951
pounds on Group IV farms. In terms of gallons, average daily sales were
578, 1,344, 2,266 and 2,087 for the four groups of farms, respectively.
Pounds of milk sold per cow per year were 8,728 on Group I farms, 8,391
on Group II farms, 8,970 on Group III farms and 8,231 on Group IV farms.


Man Equivalent of Labor and Labor Efficiency

Man equivalents were calculated by dividing total months of labor
use, including the labor of the operator and his family, by 12. This
gave the average number of men for the year. Measures of labor efficiency
indicate how much the labor force accomplishes. Cows per man, heifers
per man, pounds of milk sold per man and acres of improved pasture per
man were calculated, respectively, by dividing number of cows, number of
heifers, pounds of milk sold and acres of improved pasture by man equivalent.

Man equivalents of labor varied from 4.77 on Group I farms to
16.32 on Group IV farms (Table 9). Number of cows per man ranged from
43.6 on Group I farms to 57.3 on Group III farms. Pounds of 4 percent
F.C.M. milk sold per man was 380,580 on Group I farms, 378,196 on Group II
farms, 514,321 on Group III farms and 401,480 on Group IV farms.


Efficiency in the Use of Capital

The percent capital turnover for capital owned and capital managed
was calculated by dividing the value of milk sold by the value of capital






-13-


Table 9.--Man Equivalents of Labor and Labor Efficiency for Selected
Factors, 36 Southeast Florida Dairy Units, 1965.

Farm classification
Item
Group I Group II Group III Group IV Your farm

Man equivalent of labor 4.77 11.16 13.83 16.32

Average per man equivalent:
Number of cows 43.6 45.1 57.3 48.8
Number of heifers 16.6 19.1 5.2 21.2
Pounds of 4 percent
F.C.M. milk sold 380,580 378,196 514,321 401,480
Acres of forage crops/ -- 2.2 5.1 --
Acres of improved
pasture- 62.9 55.5 39.6 67.4

Includes acres double cropped.


owned or managed. On the basis of capital owned, the percent turnover was 62
for Group I farms and 98 for Group III farms (Table 10). This means that
$62 and $98 worth of milk was sold for each $100 of capital furnished by
the operator for these two groups of farms. In the case of capital managed,
the percent turnover varied from 62 on Group I farms to 76 on Group III
farms.

Capital managed per man was $40,204 on Group I farms and $44,200
on Group III farms. With the exception of Group III farms, the value per
man for capital managed was slightly higher for all livestock compared
with that for land. Farms in Group III had fewer acres per cow and also
more cows per man than was true for the other groups. Capital managed
per man in machinery and equipment averaged $3,256 on Group I farms,
$2,638 on Group II farms, $3,838 on Group III farms and $3,196 on Group IV
farms.


Receipts

Data on receipts are presented as averages per farm, per cow, per
hundredweight and per gallon of 4 percent F.C.M. milk sold, and percent of
total (Table 11). Annual income from the sale of milk varied from $117,173
on Group I farms to $464,006 on Group III farms. Only for farms in Group II






-14-


Table l0.--Efficiency in the Use of Capital, 36 Southeast Florida Dairy Units, 1965


Farm classification
Item
Group I : Group II Group III: Group IV Your farm

Percent capital turnover:
Owned 62 95 98 74
Managed 62 64 76 64
Capital managed per:
Cow $ 922 $ 849 $ 771 $ 835
Man 40,204 38,249 44,200 40,704
Livestock managed per:
Cow 336 348 321 336
Man 14,644 15,680 18,368 16,367
Land managed per:
Cow 327 318 220 313
Man 14,267 14,327 12,630 15,266
Building and fences
managed per:
Cow 180 116 156 114
Man 7,849 5,213 8,945 5,550
Machinery and equipment
managed per:
Cow 75 58 67 65
Man 3,256 2,638 3,838 3,196




was there a net appreciation in the value of livestock.-/ Miscellaneous
income included receipts from the sale of veal calves, manure, bags and
certain miscellaneous items of income such as soil conservation payments,
gas tax refunds, etc.


-/Herd appreciation results when the increase in value of heifers
raised exceeds depreciation on cows.






-15-


Table ll.--Summary of Receipts Per Dairy Unit, Per Cow, Per Hundredweight
and Per Gallon of 4 Percent F.C.M. Milk Sold and Percent of
Total Receipts, 36 Southeast Florida Dairy Units, 1965.

Farm classification
Item '.
SGroup I Group II Group III Group IV Your farm


Milk sold
Other income:
Net appreciation
on livestock-I
Miscellaneous
Total receipts


Milk sold
Other income:
Net appreciation
on livestocksl/
Other
Total receipts



Milk sold
Other income:
Net appreciation
on livestocks-/
Miscellaneous
Total receipts



Milk sold
Other income:
Net appreciation
on livestock"l
Miscellaneous
Total receipts


Milk sold
Other income:
Net appreciation
on livestockla
Miscellaneous
Total receipts


Average amount per dairy unit
$117,173 $275,568 $464,006 $425,022


2.944
$120,117


2,785
5,423
$283,776


9.480
$473,486


--
8.506
$433,528


Average amount per cow


$ 563.33 $ 547.86 $ 585.11


$ 533.95


q /


14.15 10.78 11.95 10.69
$ 577.48 $ 564.18 $ 597.06 $ 544.64
Average per hundredweight of 4 percent
F.C.M. milk sold

$ 6.45 $ 6.53 $ 6.52 $ 6.48


16
$ 6.61



55.51



1.39
56.90


97.5


2.5
100,0


.07
.13
$ 6.73


.13
$ 6.65


--
.13
$ 6.61


Average per gallon of 4 percent
F.C.M. milk sold (cents)
56.15 56.10 55.78


.57
1.10
57.82


--
1.14
57.24


1.12
56.90


Percent of total receipts


97,1

1.0
1.9
100.0


98.0


2.0
100.0


98.0


--
2.0
100.0


The net increase in value of any class of asset was considered
an income. Only in the case of livestock was the amount of the net in-
crease a positive figure.


--


--






-16-


Total receipts per cow ranged from $545 on Group IV farms to
$598 on Group III farms. The average price received per hundredweight
for milk sold varied from $6.45 on Group I farms, to $6.53 on Group II.
farms. Price received for milk on all farms averaged about $6.50 per
hundredweight or 55.9 cents per gallon. Total gross receipts per.hundred-
weight of milk sold was $6.61 on Group I farms, $6.73 on Group II farms,
$6.65 on Group III farms and $6.61 on Group IV farms. The higher gross
receipts on Group II farms partly reflected the net appreciation in value
of livestock.


Expenses

Summaries of expenses are shown on the basis of dollars per farm,
per cow, per hundredweight and per gallon of 4 percent F.C.M. milk sold,
and percent of total expenses (Tables 12, 13, 14, 15 and 16). The most
important items of costs were feed, labor, fertilizer and lime, depreciation
on machinery and equipment, interest on investment, operating of machinery
and milk hauling.

A brief explanation and discussion of certain items included in
expenses is given below.

Labor.--Labor costs were divided into three catagories--hired,
unpaid family and operator's labor. Hired labor represented the amount
of cash payments for help on the farm. Allowances for privileges, such
as a house in which to live, electricity, or milk furnished were in addition
to the cash costs. The costs of privileges are included in other items of
expenses such as taxes, repair and depreciation on buildings.

A value was placed by the farmer on unpaid labor equivalent to
the cash costs if it had been hired. Labor of the operator represented
the value he estimated for his labor and management. Operators with other
businesses charged only the proportion of their time they spent in managing
the dairy business. Therefore, the charge for operator's labor and
management does not necessarily represent 12 months of work.

Cost of hired labor ranged from $68.51 per cow on Group I farms
to $88.19 on Group IV farms. On a per hundredweight basis, labor costs
ranged from $.78 on Group I farms to $1.07 on Group IV farms. Unpaid
family labor was reported only on Group I farms. The value placed on
operator's labor and management was $9,182 on Group I farms, $11,327 on
Group II farms, $15,680 on Group III farms and $8,763 on Group IV farms.
The lower value of operator's labor on Group IV farms was because the
labor was spread over two or more units.

Feed.--This item included all kinds of purchased feeds fed during
the year. The cost of feed purchased was adjusted for any change in
inventory between the beginning and end of the year. A decrease in






-17-


Table 12.--Average Expenses Per Dairy Unit, 36 Southeast Florida Dairy Units,1965.

Farm classification
Item
SGroup I Group II Group III Group IV Your farm


Labor:
Hired
Unpaid
Feed purchased
Fertilizer and lime
Seed and plants
Machinery and equipment
Supplies
Veterinary and medicines
Milk hauling
Breeding fees
Utilities
Taxes
Insurance
Rent
Repairs, buildings and fences
Miscellaneous cash expenses
Total expenses before
depreciation, interestand
operator's labor
Depreciation:
Machinery and equipment
Building and fences
Other
Net herd
Total
Interest on operator's
capital at 6 percent
Operator's labor and
supervision
Total gross costs
Less value of minor
products
Net cost of milk sold


$ 14,251
680
50,585
1,809
60
3,967
2,662
587
3,954
516
2,312
2,590
1,481
291
1,645
2,884


$ 40,847

122,944
7,142
968
10,344
6,201
1,762
4,947
1,784
4,545
4,433
3,367
6,748
2,340
5,682


90,274 224,054 358,373 348,731


4,442
1,895

2,080
8,417


8,651
1,591
84

10,326


11,346 17,422 28,284


9,182 11.327
119,219 263,129


2,944
$116,275


8,208
$254,921


$ 58,941

202,086
11,387
343
10,283
7,441
3,276
17,445
1,368
6,422
5,244
5,055
9,296
6,261
13,525


$ 70,198

192,426
9,489
1,003
10,311
6,191
2,325
8,109
1,814
5,763
8,684
3,782
5,887
6,523
16.226


16,421
7,412

16,371
40,204


9,074
5,814

1,471
16,359

34,373

8,763
408,226

8,506
$399,720


15,680
442,541

9,480
$433,061






-18-


Table 13.--Average Expenses Per Cow, 36 Southeast Florida Units, 1965.

: Farm classification
Item ---
Group I Group II Group III Group IV Your farm


Labor:
Hired
Unpaid
Feed purchased
Fertilizer and lime
Seeds and plants
Machinery and equipment
Supplies
Veterinary and medicines
Milk hauling
Breeding fees
Utilities
Taxes
Insurance
Rent
Repairs, buildingsand fences
Miscellaneous cash expenses
Total expenses before
depreciation, interest
and operator's labor
Depreciation:
Machinery and equipment
Building and fences
Other
Net herd
Total
Interest on operator's
capital at 6 percent
Operator's labor and
supervision
Total gross costs
Less value minor
products
Net cost of milk sold


$ 68.51
3.27
243.20
8.70
.29
19.07
12.80
2.82
19.01
2.48
11.12
12.45
7.12
1.40
7.91
13.86


$ 81.21

244.42
14.20
1.92
20.56
12.33
3.50
9.84
3.55
9.04
8.81
6.69
13.42
4.65
11.30


434.01 445.44


21.36
9.11

10.00
40.47


17.20
3.16
.17

20.53


54.55 34.64

44.14 22.52
573.17 523.13


14.15
$559.02


16.32
$506.81


$ 74.32

254.83
14.36
.43
12.97
9.38
4.13
22.00
1.72
8.10
6.61
6.38
11.72
7.90
17.06


451.91

20.71
9.35

20.64
50.70


35.67


$ 88.19

241.75
11.92
1.26
12.95
7.78
2.92
10.19
2.28
7.24
10.91
4.75
7.40
8.19
20.38


438.11

11.40
7.30
--m
1.85
20.55


43.18


19.77 11.01
558.05 512.85


11.96
$546.09


10.69
$502.16


-~--L


I







-19-


Table 14.--Average Expenses Per Hundredweight of 4 Percent F.C.M. Milk Sold,
36 Southeast Florida Dairy Units, 1965.

Farm classification
Item
:Group II: Group III Group III Group IV Your farm


Labor:
Hired
Unpaid
Feed purchased
Fertilizer and lime
Seed and plants
Machinery and equipment
Supplies
Veterinary and medicines
Milk hauling
Breeding fees
Utilities
Taxes
Insurance
Rent
Repairs, buildingsand fences
Miscellaneous cash expenses
Total expenses before
depreciation, interest
and operator's labor
Depreciation:
Machinery and equipment
Buildingsand fences
Other
Net herd
Total
Interest on operator's
capital at 6 percent
Operator's labor and
supervision
Total gross costs
Less value of minor
products
Net cost of milk sold

Less than .05 cent.


$ .78
.04
2.78
.10
a/
.22
.15
.03
.22
.03
.13
.14
.08
.02
.09
.16


4.97

.25
.10

.11
.46

.63

.51
6.57

.16
$6.41


$ .97

2.91
.17
.02
.24
.15
.04
.12
.04
.11
.10
.08
.16
.06
.13


5.30

.20
.04
a/

.24

.41

.27
6.22

.19
$6.03


$ .83

2.84
.16
.01
.14
.10
.05
.25
.02
.09
.07
.07
.13
.09
.19


5.04

.23
.10

.23
.56

.40

.22
6.22

.13
$6.09


$1.07

2.94
.14
.02
.16
.09
.03
.12
.03
.09
.13
.06
.09
.10
.25


5.32

.14
.09

.02
.25

.53

.13
6.23

.13
$6.10






-20-


Table 15.--Average Expenses Per Gallon of 4 Percent F.C.M. Milk Sold,
36 Southeast Florida Dairy Units, 1965.


Farm classification
Item
Group I Group II Group IIIGroup IV Your farm
*___4 pt __^ *-


Cents Cents


Cents Cents


Labor:
Hired
Unpaid
Feed purchased
Fertilizer and lime
Seed and plants
Machinery and equipment
Supplies
Veterinary and medicines
Milk hauling
Breeding fees
Utilities
Taxes
Insurance
Rent
Repairs, buildingsand fences
Miscellaneous cash expenses
Total expenses before
depreciation,interest
and operator's capital
Depreciation:
Machinery and equipment
Buildings and fences
Other
Net herd
Total
Interest on operator's
capital at 6 percent
Operator's labor and
supervision
Total gross costs
Less value of minor
products
Net cost of milk sold


6.75
.32
23.96
.86
.03
1.88
1.26
.28
1.87
.24
1.10
1.23
.70
.14
.78
1.37


8.32

25.05
1.45
.20
2.11
1.26
.36
1.01
.36
.93
.90
.69
1.37
.48
1.16


42.77 45.65


2.11
.90

.98
3.99

5.37


1.76
.32
.02

2.10

3.55


4.35 2.31
56.48 53.61

1.39 1.67
55.09 51.94


7.13

24.43
1.38
.04
1.24
.90
.40
2.11
.16
.78
.63
.61
1.12
.76
1.64


43.33

1.98
.90

1.98
4.86

3.42

1.89
53.50


9.21

25.26
1.25
.13
1.35
.81
.30
1.06
.24
.76
1.14
.50
.77
.86
2.13


45.77

1.19
.77

.19
2.15

4.51

1.15
53.58


1.14 1.12
52.36 52.46


Cents







-21-


Table 16.--Percent of Total Expenses, 36 Southeast Florida Dairy Units, 1965.

: Farm classification
Item -- --
SGroup I iGroup II Group III Group IV Your farm


Labor:
Hired
Unpaid
Feed purchased
Fertilizer and lime
Seed and plants
Machinery and equipment
Supplies
Veterinary and medicines
Milk hauling
Breeding fees
Utilities
Taxes
Insurance
Rent
Repairs, buildingsand fences
Miscellaneous cash expenses
Total expenses before
depreciation, interest
and operator's labor


Depreciation:
Machinery and equipment
Buildings and fences
Other
Net herd
Total
Interest on operator's
capital at 6 percent
Operator's labor and
supervision
Total gross costs


12.0
.6
42.4
1.5
.1
3.3
2.2
.5
3.3
.4
1.9
2.2
1.3
.2
1.4
2.4


75.7


3.7
1.6
1.8
7.1
9.5


7.7
100.0


15.5

46.7
2.7
.4
3.9
2.4
.7
1.9
.7
1.7
1.7
1.3
2.6
.9
2.1


85.2


3.3
.6
a/

3.9
6.6


13.3

45.7
2.6
.1
2.3
1.7
.7
4.0
.3
1.4
1.2
1.1
2.1
1.4
3.1


81.0


3.7
1.7
3.7


6.4


17.2

47.1
2.3
.2
2.5
1.5
.6
2.0
.5
1.4
2.1
.9
1.5
1.6
4.0


85.4


2.2
1.4

.4
8.40

8.4


4.3 3.5 2.2
100.0 100.0 100.0


- Less than .05 percent.






-22-


inventory was added to the cost of feed purchased. An increase in inventory
was subtracted from the cost. Cost of feed included that fed all other
livestock in addition to the milking herd. Cost of feed per cow was
$243.20 on Group I farms, $244.42 on Group II farms, $254.83 on Group III
farms and $241.75 on Group IV farms. On a per hundredweight basis, cost
of feed ranged from $2.78 on Group I farms to $2.94 on Group IV farms or
approximately 46 percent of the gross cost of producing milk.

Fertilizer and lime.--This item covered the amount paid for
materials applied to pastures and for producing forage crops. Cost of
fertilizer and lime ranged from $8.70 per cow on Group I farms to $14.36
on Group III farms.

Seed and plants.--This was a minor item. It covered the costs for
materials applied to pastures and for producing forage crops.

Machinery and equipment costs.--This item included costs of
operating machinery and equipment such as repairs, gas, oil, grease,
machine hire and nonmilk hauling. The farm share of operation of the
automobile was also included in this cost.

Supplies.--Supplies included such things as soap, disinfectants,
sprays and miscellaneous items. Cost of supplies varied from 9 to 15 cents
per hundredweight of milk sold for the four groups of farms.

Veterinary and medicines.--This was the cost of medical supplies
and services of veterinarians. The cost varied from $2.82 per cow on
Group I farms to $4.13 on Group III farms.

Milk hauling.--This item represented the cash costs for contract
milk hauling. For farmers that hauled their own milk, this cost is
reflected in labor, machinery operation, machinery depreciation, etc.

Breeding fees.--This was the amount paid for artificial breeding.
Some farmers did not use this service.

Utilities.--This item represented the cash cost of electricity and
telephone. Cost of utilities varied from $7.24 per cow on Group IV farms
to $11.12 per cow on Group I farms.

Taxes.--Included in this amount was the cost of taxes on real
estate, livestock and equipment. In a few instances this item also
included social security taxes paid on wages of farm laborers when it was
impossible to separate this figure from all taxes paid. Costs of taxes
varied from $6.61 per cow on Group III farms to $12.45 on Group I farms.

Insurance.--This was the amount paid for buildings, livestock and
other insurance premiums.






-23-


Rent.--This item included the amount of cash paid for rented
property. Cost of rent varied from $1.40 per cow on Group I farms to
$13.42 on Group II farms.

Repairs, buildings and fences.--This item included noncapital costs
for maintenance of these facilities.

Miscellaneous cash expenses.--This class of expenses included such
items as legal and accounting fees, organization dues, D.H.I.A. dues,
travel in the interest of the farm business and other miscellaneous small
items of cost.

Total expenses before depreciation, interest and operator's labor.--
With the exception of unpaid labor, this was the total of all cash expenses
for operating the farm business. These costs ranged from 76 to 85 percent
of the gross cost of producing milk. On a per hundredweight of milk sold
basis, the total of these costs were $4.97 on Group I farms, $5.30 on
Group II farms, $5.04 on Group III farms and $5.32 on Group IV farms.

Depreciation.--Depreciation was charged to cover normal use of
capital items used in the dairy business. Depreciation on machinery and
equipment, and building and fences was calculated from the depreciation
schedule used for reporting income tax. Depreciation other included lime
that was handled as a capital item and set up on a depreciation schedule.
Other depreciation also included roads and bridges and items other than
livestock not previously mentioned that were handled as capital items and
depreciated.

Depreciation on the herd was calculated on a net change in the
value of cows, bulls and heifers between the beginning and end of the year.
The method used in calculating herd depreciation was: (Value of all
livestock at the beginning of the year plus cost of all livestock purchased)
minus (Value of all livestock at the end of the year plus the value of all
animals sold and eaten) equals net change in value for the year. This is
called the Whole Herd Method of calculating depreciation or appreciation.
Farms raising a large percent of their replacements usually have herd
appreciation because the increase in value of heifers produced exceeds
cow depreciation. The sale of veal calves was not included in calculating
net depreciation or appreciation. The value of veal calves sold was
shown as a miscellaneous cash receipt.

Interest on operator's capital.--A successful farm business should
pay all cash costs, pay the owner or operator a return for his labor and
supervision, cover an allowance for wear and tear of capital items used
in the business and earn a reasonable rate of return on the investment
in the business. Some dairymen were paying interest on loans to purchase
equipment, cows or real estate. However, interest paid on borrowed
capital does not cover total interest costs since borrowings represent





-24-


only a part of the capital required to operate the business. In calculating
interest costs, the amount of interest actually paid was omitted and
instead an interest charge was made based on 6 percent of the average
capital owned by the operator.

The charge for interest was $54.55 per cow on Group I farms,
$34.64 on Group II farms, $35.67 on Group III farms and $43.18 on Group IV
farms. The charge for interest per hundredweight of milk sold was 63 cents
on Group I farms, 41 cents on Group II farms, 40 cents on Group III farms
and 53 cents on Group IV farms. Farmers with a lower interest cost had
a higher cost for rent.

Gross costs.--This is the sum of the direct and indirect items of
expenses as explained above. The gross cost of keeping a cow for a year
was $573.17 on Group I farms, $523.13 on Group II farms, $558.05 on
Group III farms and $512.85 on Group IV farms. Gross cost per hundredweight
of milk sold was $6.57 on Group I farms and $6.22 on each of Groups II and
III farms and $6.23 on Group IV farms.

Net cost of milk sold.--The net cost of milk sold was calculated
by subtracting nonmilk receipts from gross costs. Nonmilk receipts
included miscellaneous cash receipts from the sale of veal calves and
feed sacks, conservation payment gas tax refunds, other small items of
receipts and any net appreciation in the value of the herd.

The net cost of milk sold was $559.02 per cow on Group I farms,
$506.81 on Group II farms, $546.09 on Group III farms and $502.16 on
Group IV farms. The net cost per hundredweight of milk sold was $6.41
on Group I farms, $6.03 on Group II farms, $6.09 on Group III farms and
$6.10 on Group IV farms.


Returns

Various measures of returns are shown in Table 17. Receipts are
the total of all receipts shown in Table 11. Expenses are the amounts
shown as total gross costs in Tables 12, 13, 14 and 15 minus charges for
interest on operator's investment and operator's labor and supervision.
Various measures of returns are affected by values placed on farm assets
(land at use rather than market value), rate of interest charged and the
value placed on operator's labor and supervision,

Farm income.--Farm income is the return to the operator for all
capital owned and for labor and supervision. Farm income was calculated
by subtracting expenses as indicated above from receipts. Farm income
averaged $21,426 on Group I farms, $49,396 on Group II farms, $74,909 on
Group III farms and $68,438 on Group IV farms. Expressed on a per cow
basis, farm income was $103.00, $98.21, $94.45 and $85.98 on the four
groups of farms, respectively.





-25-


Table 17.--Summary of Returns Per Dairy Unit, Per Cow,.Per Hundredweight and
Per Gallon of 4 Percent F.C.M. Milk Sold, 36 Southeast.Florida
Dairy Units, 1965.

Farm classification
Item
Group I Group II Group III Group IV Your farm


Average per dairy unit


Receipts
Expenses
Farm income
Interest on operator's
capital at 6 percent
Charge for operator's
labor and supervision
Net returns
Returns to the operator for:
Labor and supervision
Average capital owned
Percent return on
investment


$120,117
98,691
$ 21,426


$283,776
234,380
$ 49,396


$473,486
398.577
$ 74,909


11,346 17,422 28,284

9,182 11,327 15,680
$ 898 $ 20,647 $ 30,945

10,080 31,974 46,625
12,244 38,069 59,229


6.47


13.11


12.56


Dollars per cow


Farm income
Net returns
Returns to the operator for:
Labor and supervision
Average capital owned


$ 103.00 $ 98.21
4.31 41.05


48.45
58.86


63.57
75.69


$ 94.45
39.01

58.78
74.68


$ 85.98
31.79

42.80
74.97


Dollars per hundredweight of 4 percent
F.C.M. milk sold


Farm income
Net returns
Returns to the operator for:
Labor and supervision
Average capital owned


$ 1.18
.04


1.19
.51


1.05 $ 1.04
.43 .39


.52
.91


Farm income
Net returns
Returns to the operator for:
Labor and supervision
Average capital owned


10.
.


Cents per gallon of 4 percent
F.C.M. milk sold
L5 10.06 9.06 8
42 4.21 3.74 3


4.78
5.80


6.52
7.76


5.64
7.16


.98
.32


4.47
7.83


$433,528
365,090
$ 68,438

34,373

8.763
$ 25,302

34,065
59,675

10.42





-26-


Net returns.--Net returns are the returns above all costs. Net
returns ere calculated by subtracting from farm income the charge for
interest on investment and the charge for operator's labor and supervision.
The average net returns were $898 per farm on Group I farms, $20,647 on
Group II farms, $30,945 on Group III farms and $25,302 on Group IV farms.
Expressed on the basis of hundredweights of milk sold, net returns were
four cents on Group I farms, 51 cents on Group II farms, 43 cents on
Group III farms and 39 cents on Group IV farms.

Returns to operator for labor and supervision.--This is the amount
available to the operator for labor and supervision and conduct of the
dairy enterprise after covering all expenses including a charge of
6 percent on the value of operator's capital invested in the business.
This figure was calculated by subtracting the interest charge from farm
income. Return to the operator for labor and supervision averaged $10,080
per farm on Group I farms, $31,974 on Group II farms, $46,625 on Group III
farms and $34,065 on Group IV farms. Expressed on a per cow basis, this
was a return of $48.45 on Group I farms, $63.57 on Group II farms, $58.78
on Group III farms and $42.80 on Group IV farms.

Returns on capital invested.--This is the return to the operator
for the capital invested in the business after paying all expenses in-
cluding an allowance for labor, management and supervision. This is not
an amount in addition to the return to the operator for labor and super-
vision but a different way of expressing returns. Returns on average
investment were obtained by subtracting the charge for operator's labor and
supervision from farm income.

The return to capital was $12,244 on Group I farms, $38,069 on
Group II farms $59,229 on Group III farms and $59,675 on Group IV farms.
When expressed on a percentage basis, the percent return to capital was
6.47, 13.11, 12.56 and 10.42 for the four groups of farms, respectively.


Summary

A summary was made of costs and returns on wholesale dairy farms
in Southeast Florida for the 1965 calendar year.

To aid in selecting a sample for the study, two dairy farm
organizations in Southeast Florida furnished data for their members on the
amount of milk delivered during the month of October 1965. Data were
obtained for 82 management units on which 99 dairy units were operated.

For purpose of sampling, the management units were divided into
two groups--those where there were only one dairy herd on a single farm
milked in one dairy barn (single unit farms) and management units where
there were two or more herds on one or more farms milked in different





-27-


dairy barns (multiple unit farms). The single unit farms were divided
into three size groups based on the pounds of milk delivered per day
during the month of October--Group I, less than 8,100 pounds, Group II,
8,100 to 16,199 pounds and Group III farms, 16,200 pounds or more. The
multiple unit farms were sampled as a group and designated as Group IV
farms.

In summarizing and presenting the data, averages are shown for
each of the four groups of farms. In the Group IV farms, averages are
based on a dairy unit rather than a management unit in order to make
these data more comparable to farms in Groups I, II and III. No attempt
was made to calculate an average per farm for all farms in Southeast
Florida because of the extreme variation in size of individual farms in
the area.

Total acres operated were 319 on Group I farms, 767 on Group II
farms, 643 on Group III farms and 1,123 on Group IV farms. Acres operated
per cow were 1.53 on Groups I and II farms, .81 on Group III farms and
1.41 acres on Group IV farms.

Average number of cows in the hard was 208 on Group I farms, 503
on Group II farms, 793 on Group III farms and 796 on Group IV farms. The
average number of years a cow was in the milking herd was 3.20, 3.52, 2.76
and 2.70 on the four groups of farms, respectively; percent of replacements
raised was 44, 58, 17 and 47 for the four groups.

The value per farm of capital managed was $191,779 on Group I
farms, $426,857 on Group II farms, $611,287 on Group III farms and
$664,296 on Group IV farms. Value of real estate accounted for approximately
50 percent of all capital managed and all livestock 40 percent.

Amount of 4 percent F.C.M. milk sold per farm per year varied from
1,815,365 pounds for Group I farms to 7,113,060 on Group III farms. Average
sales per day was 4,974 pounds on Group I farms, 11,563 pounds on Group II
farms, 19,488 pounds on Group III farms and 17,951 pounds on Group IV
farms. Pounds of milk sold per cow per year were 8,728, 8,391, 8,970 and
8,231 for the four groups of farms, respectively.

Man equivalents of labor varied from 4.77 on Group I farms to
16.32 on Group IV farms. Number of cows per man ranged from 43.6 on
Group I farms to 57.3 on Group III farms. Pounds of 4 percent F.C.M. milk
sold per man was 380,580 on Group I farms, 378,196 on Group II farms,
514,321 on Group III farms and 401,480 on Group IV farms.

Total receipts per cow ranged from $545 on Group IV farms to
$597 on Group III farms. The average price received per hundredweight for
4 percent F.C.M. milk was $6.45 on Group I farms, $6.53 on Group II farms,
$6.52 on Group III farms and $6.48 on Group IV farms.







-28-



The net cost of milk sold was $559.02 per cow on Group I farms,
$506.81 on Group II farms, $546.09 on Group III farms and $502.16 on
Group IV farms. Net cost per hundredweight was $6.41, $6.03, $6.09 and
$6.10 on the four groups of farms, respectively.

Returns to the operator for labor and supervision were $10,080
on Group I farms, $31,974 on Group II farms, $46,625 on Group III farms
and $34,065 on Group IV farms. Labor income per cow was $48.45, $63.57,
$58.78 and $42.80 and labor income per hundredweight 55 cents, 78 cents,
65 cents and 52 cents on the four groups of farms, respectively.




University of Florida Home Page
© 2004 - 2010 University of Florida George A. Smathers Libraries.
All rights reserved.

Acceptable Use, Copyright, and Disclaimer Statement
Last updated October 10, 2010 - - mvs